After the GST is implemented from July 1, buying a home will be expensive. Where developers will benefit from GST, the buyers will have to pay about 6% more tax. That is why despite the government’s instructions, developers can avoid the benefit of GST by pass-through on the buyers. However, developers say that in the cheap houses, the buyer can be made a pass-on, but due to GST, buyers of MIG and luxury projects will have to pay a higher price. The Byers Association says that the buyer will be harmed by GST, but the developers are also misleading them. Points to Know How Much Buying a Home After GST
1- To pay a higher tax: Currently, buyers give 4.5% service tax to developers, while 1% VAT and 6% stamp duty during Registry. In this way buyers have to pay approximately 11.5% tax on the purchase of the house, but after July 1, the buyer has to pay 12% in lieu of the service tax.
2- Stamp Duty: During the Registry, 6% stamp duty will be deposited in the same way as before, thus giving a total 18% tax to the buyers, which will be about 6.5% more.
3- Misleading Developers: Annu Khan, president of Noida Estate Flat Owners’ Main Association (Naphoma) said that the developers of under construction project send letters to the buyers and say that if they give the money before July 1, then approximately 7.5% of tax will be saved, because now Service tax will be 4.5% and after July 1, 12% GST will be given.
4- What is the position of buyers?: Umesh Prabhakar, general secretary of the Federation of apartments associations, Greater Faridabad, said that the payment of the full payment from now on will be only those few buyers who are likely to get the next month and can pay their outstanding dues. The rest will not be of any benefit to the buyers, but after getting the full payment the developers will not show interest in giving quick positions.
5- Interest on exemption on loan for payment: According to Prabhakar, the buyers who have taken a home loan, if they pay by taking loan from the bank, they will have to pay the bank more than the exemption. Stamp duty has not been included in GST, so home buyers will have to pay stamp duty along with GST as well, so buying a house will be costlier than today.
6- When are the benefits to buyers?: Gaurav Jain, Vice President, National Association of Real Estate Development Council (NAREDCO) said, “It is true that after the implementation of GST, the advantage of tax rebate of 3 to 5% can be passed on to the buyers and Some developers are ready for this, but this advantage can only be passed on when the government thinks about land-abatement. The prices of land in big cities are so high that day Project Lprs costs come at a premium.”